Dominion Energy’s long-anticipated $9.8 billion Coastal Virginia Offshore Wind project is steadily taking shape as gigantic monopile foundations are installed in the ocean floor 27 miles off the Virginia Beach coast.
This past spring, four years after two test turbines began generating power, Dominion installed the first monopile foundation for the 2.6-gigawatt offshore wind farm’s remaining 174 turbines. As of August, the 50th monopile was installed, and by the time work stops in November for the year, the Fortune 500 utility expects about half of the 272-foot, 1,500-ton cylinders to be installed.
“The project is on time and on budget,” says John Larson, Dominion’s director of public policy and economic development. “As a regulated utility, Dominion Energy went out early on and got contracts in place for all the different components. That’s one of the values of having a regulated utility develop offshore wind projects. It brings a lot of surety to our customers and makes sure we make the best decisions going forward.”
The past six months have been busy for Dominion, both in terms of building CVOW to meet the 2026 completion deadline, and in making financial deals that likely mean future investment in wind energy.
In February, Dominion reached an agreement with investment firm Stonepeak to sell it a 50% noncontrolling stake in CVOW for nearly $3 billion, a deal that will improve Dominion’s estimated 2024 consolidated FFO-to-debt by approximately 1%, reduce its overall financing needs during the wind farm’s construction and lower risks. The deal is expected to close by the end of the year, pending approval from state and federal regulatory agencies.
Then in July, a Dominion subsidiary agreed to purchase the Kitty Hawk North Wind offshore wind lease from Avangrid for $160 million. The 40,000-acre lease will be renamed CVOW-South and will be capable of 800 megawatts of offshore wind generation in the 2030s, enough to serve 200,000 customers. After receiving regulatory approval, the transaction is expected to be completed late this year.
And in August, Dominion won a 176,505-acre lease about 35 nautical miles from the mouth of the Chesapeake Bay for a $17.65 million bid in a Bureau of Ocean Energy Management auction. That area could support between 2.1 gigawatts and 4.0 gigawatts of electricity, in addition to other wind energy generated at CVOW.
In addition, LS Greenlink USA, a subsidiary of South Korean firm LS Cable & System, will create 330 full-time jobs when it builds a $681 million manufacturing plant in Chesapeake for undersea cables used in the offshore wind industry, Gov. Glenn Youngkin announced in July. Construction on the 750,000-square-foot facility is set to begin in 2025, with operations commencing in early 2028.
The Orion, a heavy lift vessel owned by Belgium-based dredging and offshore energy services company DEME Group, transports the monopiles from a staging area at Portsmouth Marine Terminal to the CVOW lease area. In late 2025, Dominion’s ship Charybdis, the first U.S.-based wind turbine installation vessel, will arrive to begin transporting towers and blades to the wind farm. Turbine components are being manufactured in Europe and will be staged at the Portsmouth Marine Terminal.
Three offshore 190-foot-by-190-foot substations also will be installed at different locations within the lease area. Sixty turbines will feed into each substation.
Larson says 800 Virginians have been working on the project, including about 650 Hampton Roads-based workers. CVOW is forecast to have up to 900 jobs per year during construction and up to 1,100 jobs annually once operations start. About 1,600 people will be employed during the project’s peak period in 2025.
The Hampton Roads Workforce Council has also partnered with Dominion from CVOW’s inception to help fill jobs and ensure offshore wind employment opportunities are promoted regionally and statewide.
“For us, it’s really about the trades,” says Steve Cook, the council’s chief innovation officer. “We’ve established a system in Hampton Roads to make sure there’s a supply of workers for all facets of the maritime industry.”
Virginia is reaping thousands of jobs and huge tax revenues as Amazon.com revamps its U.S. delivery network. The e-commerce giant is opening major distribution centers and sorting facilities across the commonwealth as part of its nationwide strategy to get goods to consumers faster and stay one step ahead of competitors like Walmart and Target that have seen a surge in online orders, as well as newer online upstarts Shein and Temu.
Already the largest industrial tenant in North America, Amazon has leased, purchased or announced plans for more than 16 million square feet of new warehouse space across the nation this year as part of its distribution network upgrade. Traditionally relying on a centralized network, the Seattle-based company with its East Coast headquarters in Arlington County is developing nine regional distribution networks across the country to ensure customers can obtain products quickly from nearby fulfillment centers. Doing so necessitates placing inventory in more warehouses nationwide.
“Amazon’s network is continually optimized to position products close to the demand location, requiring additional investments when activity in a region reaches certain thresholds,” explains Jason El Koubi, president and CEO of the Virginia Economic Development Partnership.
Across Virginia, more than 30 warehouses, 11 fulfillment and sortation centers and 16 delivery stations bear the Amazon brand. The online retailer opened its first Virginia fulfillment facility in Sterling in 2006 and continues to expand across the state, investing more than $109 billion and creating more than 36,000 jobs since 2010. Additionally, Amazon has contributed more than $72 billion to the state’s gross domestic product. Those investments have helped solidify Virginia’s position as one of North America’s prime supply chain hubs.
“We have a very strong and positive relationship with Amazon,” says El Koubi. “Amazon plays a very important role in the ecosystem of distribution and supply chain operations in Virginia and is one of the core providers of logistics-related job growth. It has a very sophisticated network that continues to be optimized to position products close to demand centers.”
Big presence
In 2021, Amazon chose Stafford County as one of its East Coast hubs where items from third-party vendors are sorted, repacked and sent to other distribution centers. The 630,000-square-foot cross-dock fulfillment center in the Northern Virginia Gateway industrial park opened in 2022, bringing 500 jobs to the Fredericksburg and Stafford region.
Virginia’s newest Amazon facilities — a 650,000-square-foot robotics fulfillment center in Henrico County that created more than 1,000 full-time jobs and a 1 million-square-foot non-sortable fulfillment center in Augusta County with 500 jobs — opened in 2023. A last-mile distribution center in Roanoke is expected to be up and running by late this year.
Also set to open in time for the holiday season is a 219,000-square-foot Virginia Beach delivery station, with an adjacent 650,000-square-foot robotics fulfillment center coming online in 2025. Combined, Amazon is investing $350 million in the facilities, which are expected to bring more than 1,000 jobs to Hampton Roads. They join other Amazon sites in Hampton Roads, including the company’s first robotics fulfillment center in Virginia, a $230 million, 3.8 million-square-foot, five-story robotics behemoth in Suffolk that lays claim as the state’s second largest building behind the Pentagon, and a $50 million, 650,000-square-foot fulfillment center and career center in Chesapeake. Amazon’s Suffolk facility employs about 1,500 workers, while the Chesapeake center has about 1,000 employees.
The Hampton Roads Alliance, the regional economic development organization, has worked with Amazon since 2020, when the Fortune Global 500 online retailer and tech company announced it would build the distribution centers in Suffolk and Chesapeake.
“In just a few short years, Amazon has become one of Hampton Roads’ major employers,” says Alliance President and CEO Doug Smith. “The company has proven to be a strong corporate partner and an ally in recruiting and retaining the next generation of talent.”
In addition, Amazon operates three Prime Now fulfillment centers in Virginia Beach, Springfield and Richmond, which offer one- and two-hour deliveries for Amazon Prime customers in Virginia. Amazon also has 16 Whole Foods Markets and five Amazon Fresh outlets across the commonwealth.
Most notable about the company’s Virginia presence is its $2.5 billion East Coast headquarters, HQ2, which it opened in Arlington in 2023.
Last year, Amazon also announced that it will double its investment in data centers so far across Virginia, spending another $35 billion by 2040 and adding at least 1,000 jobs.
In all, Amazon has 39,000 full- and part-time employees in Virginia. The retailer also works with more than 11,000 Virginia-based independent sellers — mostly small and medium-sized businesses.
‘Huge impact’
Virginia’s pro-business environment drew Amazon to the commonwealth.
“Strong local, state and regional support have made Virginia attractive to Amazon,” says Amazon spokesperson Sam Fisher, adding that the company is constantly exploring new locations when deciding where to develop sites to best serve customers.
“Virginia is a great state to do business, and the support we’ve received from day one has been key to our ability to invest, grow, hire and innovate on behalf of our customers.”
Amazon is investing $350 million to construct a fulfillment center and a delivery station in Virginia Beach. Photo by Mark Rhodes
Amazon’s Henrico Fulfillment Center, built on 199 acres adjacent to Richmond International Raceway, brought more than 1,000 jobs to Central Virginia.
“This has had a huge impact for us,” says Henrico Economic Development Authority Executive Director Anthony Romanello. “Amazon has done everything they said they would do in terms of investments and hiring.”
The largest building in Central Virginia, the fulfillment center spans 2.7 million square feet and is Amazon’s second robotics center in Virginia. The company worked with Texas-based Hillwood Development to secure the property, which was purchased for $7.7 million. Hillwood frequently joins Amazon in warehouse development projects nationwide.
A pandemic-fueled increase in e-commerce propelled much of Amazon’s expansion, with the company snatching up 40% of U.S. warehouse space in 2020.
In Northern Virginia, Amazon’s growth has helped keep industrial sector vacancy rates in the low- to mid-single digits, says Nate Edwards, Cushman and Wakefield’s senior director of Washington, D.C., metro research. By contrast, more than 20% of office space in the D.C. region sits vacant as significant numbers of employees have shifted to remote and hybrid work.
“COVID was an excellent thing for Amazon and industrial brokers,” says Cushman & Wakefield Executive Director Jon Lawrence, who notes that skyrocketing demand for industrial space has led to double and triple rental rate increases. “Amazon has eaten up a lot of warehouse space in Northern Virginia. I’ve been doing this for 37 years and have never seen anything like the last four years.”
As the largest industrial tenant in Northern Virginia, Amazon has inventory in about a dozen 60,000-, 80,000- and 100,000-square-foot buildings in Northern Virginia. “There’s not 1 million square feet in one building but broken into a bunch of buildings in Ashburn, Chantilly and Manassas,” Lawrence says. “There’s no zoned land left in Northern Virginia to build warehouses, and supply is incredibly limited.”
Competitors have been watching Amazon’s growth and trying to emulate it. For example, online furniture and home décor retailer Wayfair has a large distribution center in Manassas. “Everyone sees what they’re doing and figures out how to do it as well,” Lawrence says, “but it’s safe to say no one is close to being as successful as Amazon.”
However, he believes that Amazon will eventually put the brakes on its warehouse growth. “Nobody can keep doubling or tripling their business forever. There will be a pause. At some point in time, they have to have enough warehouses to distribute products in the next 24 hours.”
‘Success begets success’
More than 4,600 companies, spanning warehousing and storage, road, rail, air and maritime freight transport make up Virginia’s diverse logistics ecosystem for distribution and supply chain operations, notes El Koubi. Other leading logistics companies, such as FedEx, UPS, DHL, Patton Logistics, InterChange Group, and Lineage Logistics, have also made significant investments in storage and distribution facilities in Virginia.
Those investments are the upshot of Virginia assets such as the Port of Virginia and Dulles International Airport, as
well as the state’s strategic mid-Atlantic location. “Companies can get to 75% of the U.S. population in two days or less by road,” El Koubi notes. “As the nation’s mean center of population has shifted to the South over the past decade, that
gives Virginia an advantage.”
Hampton Roads has always been a hub for logistics companies, says Smith. “The region’s labor force has plentiful talent for companies looking to distribute their goods both domestically and internationally.” He adds that much of the region’s current industrial development has focused on western Hampton Roads, where Amazon, Target and Ace Hardware have opened distribution centers.
Demand for industrial and distribution space has spiked in the region. CoStar Group, a major provider of commercial real estate data and analytics, noted in February that less than 4% of industrial space is available in Hampton Roads, one of the tightest availability rates nationally. Demand has led to multiple speculative projects, with industrial construction seeing a 63% jump in the market’s pipeline during the first quarter of 2024.
Currently, 4.2 million square feet of industrial space are under construction, including Amazon’s Virginia Beach fulfillment center. According to CoStar, this is only the third time in a decade that more than 2 million square feet of distribution space has broken ground in a single quarter.
“In this case, success begets success as industrial developers have stepped up to meet the ever-increasing demand,” Smith says.
As e-commerce mushroomed over the past few years, record absorption followed, says Geoff Poston, a Cushman & Wakefield | Thalhimer senior vice president who leads the company’s Hampton Roads industrial group. “The industry has been on a crazy run the past four or five years,” Poston says. “E-commerce is a large part of what has driven leasing and absorption activity. Developers were racing to build more space.”
Poston adds that the industry is still doing very well but not at the same historic rates as over the past three years, a byproduct of what he calls a COVID hangover effect. “All that demand came at one time,” he says. “Retailers sold two to three years of inventory in one year. Leasing rates rose dramatically, and properties were being leased. All of a sudden, demand among tenants cooled off.”
Still, logistics companies like Amazon are continuing to invest and expand in Virginia.
“We see a lot of potential for growth,” El Koubi says, noting that VEDP has made logistics one of its target economic growth sectors.
“Logistics is one of the most rapidly growing sectors in Virginia and a sector in which Virginia is at an advantage,” he adds. “One of Virginia’s great strengths is our economic landscape is very diverse. Almost any kind of business operation can excel here.”
After three decades recruiting businesses to Norfolk, Portsmouth and Hampton, Charles E. “Chuck” Rigney is tackling a new challenge: leading Virginia Beach’s economic development.
Rigney was named the Resort City’s permanent economic development director in February. It was one year after he joined the department as a business development administrator and eight months after he became interim director following the departure of the department’s former head, Taylor Adams, for a job in Nevada.
“The opportunity to work with the largest city in Virginia was greatly appealing,” Rigney says. “The future is extremely bright because of all the assets we have here.”
Virginia Beach is awash in major developments. Amazon.com is investing $350 million in the city on a robotics fulfillment center set to open in 2025 and a delivery station slated to start operations for this year’s holiday season. Last year, Zim Integrated Shipping Services said it would invest $30 million to relocate and expand its U.S. headquarters from Norfolk to Virginia Beach, while in November 2023 cloud-based document management company Doma Technologies announced a $4 million expansion that will add more than 300 employees. Also on the horizon: Dominion Energy’s $9.8 billion Coastal Virginia Offshore Wind project, additional digital transatlantic subsea cable landings, new Oceanfront hotels and the long-awaited Atlantic Park surf park development from the city’s most famous native son, the music star and fashion icon Pharrell Williams.
It’s a full agenda, but one that Rigney, a 1979 Old Dominion University graduate who worked in banking and commercial real estate before entering economic development, relishes, especially as the city’s name and reputation grow. “The beach is pretty well known,” he says. “When I [travel] and get in a cab and say I’m from Virginia Beach, they know where I’m talking about. My job is to get it even better known.”
Rigney’s experience and demeanor make him the ideal choice to direct Virginia Beach’s economic development operations, says Doug Smith, president and CEO of the Hampton Roads Alliance, the region’s economic development partnership. “He is a good listener, good team builder and understands the importance of getting input from the largest of stakeholders. Nowhere is that more important than Virginia Beach — the largest city in the region.”
Surf park’s up
While other cities where Rigney has worked are more urban and have had more experience with revitalization, Virginia Beach is just now beginning to look at redevelopment strategies. Open parcels of land are becoming fewer and fewer, Rigney notes: “We have to look at strategic growth areas where things can be done differently and transition older properties into new developments.”
That includes aging Oceanfront hotels. Developers are lining up to invest millions of dollars into redevelopment initiatives and asking the city to chip in for necessities like water and sewer and infrastructure improvements. Rigney wants to capitalize on that interest. He notes that 14 million visitors spent a record $2 billion-plus in Virginia Beach last year. “That’s a reflection of successful initiatives of the past,” he says, “but as properties age, more hotels are coming in, and more hotel rooms are needed.”
One prominent proposal comes from former Virginia Gov. Robert McDonnell and Divaris Real Estate Chairman and CEO Gerald Divaris, who are proposing to build a 450-room hotel and parking garage on property the city owns on 17th Street. The city bought the parcel, which includes a public park and a Dairy Queen, for $12.8 million in 2022. McDonnell and Divaris’ plan would keep the park intact.
“That’s one of many proposals,” Rigney says, adding that talks to revamp the site are still in the early stages. “Any deal would have to go through numerous community meetings and refinement. It’s great to have serious guys like Gerald Divaris and Bob McDonnell interested, as well as other folks in our backyard. We’ll work with everybody to see how to take the city to the next level.”
Meanwhile, construction continues on the first phase of Atlantic Park, a $325 million mixed-use project being developed by Williams and Venture Realty Group. First announced more than six years ago, the surf park and music venue is set to open in spring 2025. Anchored by a nearly 3-acre surf lagoon, the project includes a 3,500-seat entertainment venue, retail space, offices and 309 residences on the former Dome music venue site between 18th and 20th streets. The second phase, still in development, will include additional apartments, parking, office and retail space and a boardwalk connecting the site to the Virginia Beach Boardwalk and 17th Street Park. “Atlantic Park is huge for us,” Rigney says. “It has spurred interest in the surrounding area and led to new growth.”
Williams, who last year became men’s creative director for luxury fashion house Louis Vuitton, has been an avid promoter of his hometown, and is in the process of filming a big-budget musical film this summer in Virginia, based on his childhood growing up in Virginia Beach’s Atlantis Apartments. His Something in the Water music festival debuted at the Oceanfront in 2019 and returned in 2023, generating $50 million to $60 million in economic impact for the city over both years.
“He’s done an amazing thing for his hometown,” Rigney says, adding that Something in the Water and Atlantic Park have attracted many developers to Virginia Beach, giving his department the chance to show off the city. “If developers come to see us one time, we always make a short list of anything they need.”
Rigney is also excited about another park, this one at Rudee Loop on the resort area’s southernmost end. The roughly 8-acre site has been used for parking and as a staging area for large Oceanfront events, but last fall the City Council voted to transfer $4 million from the city’s tourism fund to create a public recreation area. “That will be a real showcase and ultimately will be a real selling point for the beach,” Rigney says. “It was exciting once the concept got in front of council to think about reserving an area for tourists and residents alike to enjoy an open space. You don’t need to always put buildings on things to make a thriving economic attractor.”
Conventional development
Redevelopment is also on the drawing board for the area around the Virginia Beach Convention Center. Earlier this year, the city approved a $75,000 study examining the impacts of a mixed-use sports and convention district around the convention center. It will also examine potential uses for the Parks Avenue home of the Virginia Museum of Contemporary Art, which plans to move to a new site on Virginia Wesleyan University’s Virginia Beach campus in 2025.
Over the years, Virginia Beach City Council has prioritized the development of a convention center hotel, asserting that such a facility would position Virginia Beach to better compete for regional and national events. Maryland-based Capstone Development has proposed building a 300-room convention hotel adjacent to the convention center. Capstone’s project also would include more than 900 apartments and approximately 160,000 square feet of retail, creating an estimated 800 jobs.
Rigney is confident that a hotel eventually will be built on the site. “All of us understand that having a convention center hotel is long overdue and gives our convention center that much more of a draw,” he says. “One way or another we’re going to get a hotel.”
However, he adds, large-scale projects must complement current developments. “It all has to fit. We don’t want anything that will pull away from Atlantic Park and the ViBe [Creative] District.”
Looking to the city’s Central Business District, Rigney is eyeing the expansion of Virginia Beach Town Center. The 20-year-old mixed-use development, which includes corporate office towers, restaurants, shops and hotels, has thrived through economic downturns and the COVID pandemic. Offices there are completely leased, and, Rigney says, Town Center is ripe for growth. “If we don’t double the size of Town Center in the next 20 years, we probably will not have done as much as I would like to.”
Offshore wind, subsea cables
While tourism, defense and maritime/logistics form the pillars of Virginia Beach’s economy, Rigney is eager to add more legs in the form of offshore wind and subsea internet cables.
The city is working to attract manufacturers to Virginia Beach to support installation and maintenance of the 176 massive wind turbines Dominion Energy is installing for its Coastal Virginia Offshore Wind project 27 miles off the Virginia Beach coast. “Almost everybody in wind energy knows Virginia Beach,” Rigney says. “We want to be able to hear them out and determine if our location is a fit for them.”
Next April, about 2,300 leading industry experts will descend upon Virginia Beach for the International Partnering Forum, the largest offshore wind energy conference in the Americas. Hosting the conference is a coup for Virginia Beach, Rigney says. “That puts us in league with cities like New Orleans, where IPF has been held.”
Meanwhile, the city’s status as one of the few East Coast landing spots for subsea internet transmission cables is starting to reap dividends. Globalinx opened a data center and cable landing station in 2019 and 2020 in the city’s Corporate Landing Business Park. The data center provides colocation space for high-speed subsea telecommunication cables MAREA, BRUSA and DUNANT, which connect Virginia with points in Europe and South America. In May, FiberLight, a fiber infrastructure provider, announced plans to establish high-speed ethernet service from the Globalinx data center.
A joint project from Venture Realty Group and Pharrell Williams, the $325 million Atlantic Park surf park and music venue is slated to open in spring 2025. Rendering courtesy Hanbury
“Quite a few businesses are seriously considering Virginia Beach largely because of our location along the Middle Atlantic coast,” Rigney says. “We work closely with prospects in the data center business to see what their needs are and where we can put them. If we can get high-speed volume data companies to get a few milliseconds faster to market by being closer to the cables coming into Virginia Beach, it’s a big opportunity for us.”
Economic development efforts, however, are careful to align with the U.S. Navy’s footprint in Virginia Beach, especially Naval Air Station Oceana, the East Coast base for the Navy’s strike fighter jet squadrons.
“Because we want to ensure Oceana is here forever, we partner with the Navy to ensure there is no encroachment to make flight operations difficult,” Rigney says, noting that over the years, the city has purchased properties around the base, zoning them for compatible uses such as data centers and subsea cables. “That helps to monetize restrictive areas.”
Rigney also supports regional development efforts throughout Hampton Roads. As Virginia Beach’s interim economic development director, he convinced City Council to join the Eastern Virginia Regional Industrial Facility Authority (EVRIFA), a mechanism for pooling resources across multiple localities into site development opportunities that benefit the entire region. It wasn’t
a hard sell, he says.
“The city leadership recognizes we can partner with other cities in ways we have never done before,” Rigney says. “If there’s an opportunity to invest in a project that attracts a car manufacturer to Chesapeake, for instance, and we get a return from it, that’s a direct economic benefit on our investment.”
A longtime advocate for regional cooperation, Rigney is pleased to see increased collaboration among Hampton Roads municipalities. “We have a bunch of folks at the beach and in other communities who truly like each other. That cooperation will help raise the profile of the region.”
And he intends to be part of those cooperative efforts for quite a while. Discussing his plans to beef up the city’s economic development team with new business development managers, Rigney says he has no plans to retire any time soon.
“When I leave one of these years, I want to have a multitude of talent on board to take my place,” he says, “but I have no desire to quit. I love what I do and am passionate about doing it well.”
Virginia Beach at a glance
Virginia Beach Town Center
Virginia’s most populous city and the 43rd largest in the United States, Virginia Beach encompasses 310 square miles, with 38 miles of beaches along the Atlantic Ocean and Chesapeake Bay. A major East Coast tourism destination, Virginia Beach features a vibrant resort area on its Oceanfront. Along with tourism, major industries include defense, bio and life sciences, advanced manufacturing, maritime and logistics, IT and offshore wind energy. It’s also home to Naval Air Station Oceana, the East Coast base for the Navy’s strike fighter jet squadrons. Regent University and Virginia Wesleyan University are based in Virginia Beach, along with campuses for Tidewater Community College, Old Dominion University and Norfolk State University.
Population
460,000
Top employers
Naval Air Station Oceana-Dam Neck Annex (10,227)
Joint Expeditionary Base Little Creek-Fort Story (5,020)
Sentara Health (4,900)
GEICO (3,600)
Stihl Inc. (3,300)
Major attractions
Virginia Beach’s 3-mile Boardwalk in the city’s Oceanfront area attracts tourists from around the world. Virginia Beach Town Center is a centrally located, major mixed-use development with hotels, restaurants, shopping and offices. Visitors also enjoy the Virginia Aquarium & Marine Science Center, which features live animal habitats and the six-story 3D National Geographic Theater. Other attractions include First Landing State Park, Cape Henry Lighthouse and the Military Aviation Museum.
Major convention hotels
The Founders Inn and Spa 40,000 square feet of meeting space,
240 rooms
The Cavalier Resort* 70,875 square feet of meeting space,
547 rooms
Holiday Inn Virginia Beach – Norfolk 22,000 square feet of meeting space,
317 rooms
Wyndham Virginia Beach/Oceanfront 16,247 square feet of meeting space,
244 rooms
The Westin Virginia Beach Town Center 11,266 square feet of event space,
236 rooms
Over the years, scientists have warned about sea-level rise, especially in Norfolk, which has the highest rate on the East Coast.
“Norfolk is very flat. When you see a small increase in water levels, a wide part of land floods in response,” says Molly Mitchell, a researcher at the Virginia Institute of Marine Science, which issues annual sea-level report cards for 32 coastal communities in the United States.
Hampton Roads as a whole will probably see between 1 and 3 feet in sea-level rise by 2050, according to the National Oceanic and Atmospheric Administration (NOAA), and Mitchell says that’s just the beginning. “Change [in the rate of sea-level rise] is happening more rapidly. Between 4 and 6 feet of sea-level rise by 2100 is considered pretty likely.”
It’s hard for non-scientists to picture the overall impact of oceans even a foot above where they are now, but researchers recently produced the Global Maritime Trends 2050 report, which forecasts that about a third of the world’s 3,800 ports will be unusable by 2050 due to sea-level rise — particularly those in Houston, Shanghai and Mexico. The report, which was produced in collaboration with Economist Impact, recommends that ports step up efforts to decarbonize and boost infrastructure resilience and efficiency.
While the Port of Virginia was not singled out in the report, Norfolk International Terminals, its largest maritime facility, is vulnerable to storm surge flooding. Mitchell contends that everything on land at the port has the potential to flood, including buildings and roads leading to the port.
“Part of the solution is to identify where the problems could occur and look at ones that are easily fixed, such as raising low-lying roads on the way to the port,” she says. “Flooding is not just an issue for the Port of Virginia, but sea-level rise is higher at the Port of Virginia than at the Port of Charleston, so they will have to deal with that sooner.”
Officials at the Port of Virginia say they’re working on the issue, although so far, sea-level rise has not raised significant concerns among port customers.
“That’s not to say that we don’t take sea-level rise seriously,” says Cathie J. Vick, the port’s chief development and public affairs officer. “Our assessment is that sea-level rise will have minimal impacts on our operations because there is already ample space between the projected median high-tide line and the decks of our berths. We currently do not experience tidal flooding at our terminals, but from time to time may have standing water from prolonged rain events.”
After conducting critical infrastructure surveys, port officials raised power stations to protect them from flooding events, such as sea-level rise, tidal surges and torrential rain. “We have very specific construction guidelines to ensure our investments will remain viable over the long term,” Vick says. “We are very fortunate because we are not in a position to have to begin planning a retreat from any of our terminals or offices.”
Instead, the port is focused on slowing climate change and its effects, such as sea-level rise. According to NOAA, moving to more renewable energy sources is starting to slow sea-level rise. “We have committed to becoming a net-zero [carbon] operation by 2040 and are taking deliberate actions to use clean fuels to move cargo and power our operations,” Vick notes.
This year, the port became the first major U.S. East Coast port to run its entire operation from all carbon-free energy sources. The power purchase agreement with Dominion Energy, in cooperation with Rappahannock Electric Cooperative, will allow the port to offset its carbon footprint by reducing carbon emissions 45% per container.
“From the big ship-to-shore cranes to the forklifts in the shops, more than 50% of the equipment we use is electric or hybrid-electric,” Vick says. “This effort and investment will continue until we have hit our 2040 goal [of becoming carbon neutral].”
Plans in place
In addition to the port, the cities of Norfolk and Virginia Beach are also fully involved in flood management to protect their assets.
The issue is particularly acute in Norfolk. With Norfolk’s risk of flooding and damage from coastal storms on an upward trajectory, the city and the U.S. Army Corps of Engineers are collaborating on the Norfolk Coastal Storm Risk Management Project, a combination of structural, nonstructural and natural measures to counteract flooding that will be implemented over the next decade. Known as Resilient Norfolk, the
$2.6 billion project includes storm-surge barriers, almost 9 miles of floodwalls and levees, 11 tide gates and 10 pump stations, as well as home elevations, basement fills, oyster reefs, wetlands mitigation and living shorelines.
“We have $40 billion worth of real estate in the city, including the Port of Virginia, the Naval Base, universities and the region’s only Level 1 trauma center, that will benefit from these measures,” says Kyle Spencer, Norfolk’s chief resilience officer. “For every $1 million we do in flood projects, we will typically see $6 million back in benefits.”
The city will fund 35% — or $931 million — of the project, while federal funds, including $400 million awarded through the Bipartisan Infrastructure Law, will pay for 65%.
Gov. Glenn Youngkin included $73.85 million for Resilient Norfolk in his 2024 budget, but the General Assembly reduced that allocation to $25 million, although the state’s 2024-26 budget won’t be finalized before mid-May at the earliest.
Molly Mitchell is a researcher at the Virginia Institute of Marine Science, which issues annual sea-level report cards for 32 U.S. coastal communities. Photo by Kristen Zeis
“We’re working with the governor’s office to find additional state funds,” Spencer says. “That’s a continuous effort, but the cost of not doing anything is far worse. It’s not just about property damage. There’s a huge amount of risk to personal safety.”
Currently under design, the first phase of Resilient Norfolk will include a system of floodwalls with a levee and surge barriers from downtown to Ghent. Construction of a downtown floodwall is slated to be completed in the early 2030s. In the second phase, floodwalls and barriers will be installed to decrease storm surge from entering Pretty Lake at Shore Drive. The design portion is expected to get underway this year, with construction continuing through early 2028.
Flooding impacts at the port will be addressed in phase three when a storm surge barrier will be installed from Norfolk International Terminals (NIT) to Lambert’s Point, where construction of the Fairwinds Landing maritime operations and logistics center is underway. Construction on the storm barrier, meanwhile, is expected to begin in late 2027. The city is also working with the port to develop shoreline projects to mitigate wave activity against NIT.
“That will be designed to stop catastrophic flooding from going into the Lafayette River and flooding Hampton Boulevard and key port assets,” Spencer notes. “The port is a working waterfront, so we can’t really put a floodwall up, but we can raise equipment off the ground and build deployable floodwalls to put in place before storms and put them around critical equipment like water pump stations and electric substations.”
Phase four will include construction of floodwalls, storm surge barriers and tide gates to diminish storm surge from entering Broad Creek at I-264. In the final phase,homes and other structures will be elevated and basements filled in flood-prone areas of the city, including southside Norfolk and Willoughby.
After residents in some of those areas questioned why their neighborhoods would not be protected with floodwalls, the city asked the Army Corps of Engineers to re-evaluate the plan. The reevaluation will take three to five years at a cost of $4 million to $6 million.
Spencer notes that Resilient Norfolk, while accounting for sea-level rise, is primarily designed to deal with catastrophic storms. “We’re overdue for one of these large storm events,” he adds. “We’re seeing the environment changing and rainfall happening at a faster rate, and we need to adapt.”
Flooding makes beachhead
Resilience is also a priority in Virginia Beach where high tides in low-lying areas can lead to flooding even on sunny days, a situation known as recurrent flooding. In 2021, voters overwhelmingly approved a $568 million bond referendum to install tidal gates at West Neck Creek, the Lesner Bridge, Rudee Inlet, Elizabeth River and Back Bay, pump stations and pipes to improve stormwater drainage and minimize inundation from heavy rains and tidal flooding, and restoration of the Elizabeth River shoreline. The 10-year plan also includes about
$2.6 billion worth of improvements, from elevating roads to converting the 100-acre Bow Creek Municipal Golf Course into a stormwater park to mitigate flooding in surrounding neighborhoods.
In addition, Virginia Beach plans to construct a marsh terrace on Back Bay to restore about 300 acres of wetland lost over the last 350 years. Designed to prevent erosion, the berm will be the first of its kind on the East Coast.
“They’ve done a lot of these on the Gulf Coast, but it’s never been looked at before on the East Coast,” says C.J. Bodnar, technical services manager for the Virginia Beach Stormwater Engineering Center. “It will recreate lost wetlands and could lead to a slight reduction in flooding.”
Along with the bond referendum, Virginia Beach has obtained more than $40 million in grants. “We continue to look for state and federal grants to help with the cost of these projects,” says Mike Tippin, the stormwater engineering center’s administrator.
Mitigating sea-level rise isn’t “just about property damage. There’s a huge amount of risk to personal safety,” says Kyle Spencer, Norfolk’s chief resilience officer. Photo by Mark Rhodes
Despite the costs, Tippin and Bodnar stress that the city cannot put off addressing sea-level rise.
“If we don’t do anything, we’ve got the city of Virginia Beach becoming the island of Virginia Beach,” Bodnar says.
Overall, Virginia has led the Southeast U.S. in adapting to climate change, but there’s still much to accomplish, says Jessica Whitehead, executive director of Old Dominion University’s Institute for Coastal Adaptation and Resilience. “The state has been moving forward and taking action despite not having endured a major storm to force everyone to the table. That says something about the scale of climate change — that we have so far to go.”
Whitehead adds that multiple strategies are needed to address sea-level rise and other climate change issues and build resilience. “There’s never a single project that will fix 100% of the problems. You have to figure out the menu of options and choose what’s feasible depending on how much funding you have.”
In a relatively short time, Josh Thomas has seen the Prince William County district he represents in the Virginia House of Delegates transform from farmland and residential neighborhoods to massive buildings filled with the digital infrastructure that stores, processes and distributes huge amounts of information across the global internet, from cloud computing for businesses to streaming media for home entertainment.
“This use of land is changing the character of the district,” says Thomas, a Democrat who was elected to his first term in the General Assembly last November. “Farmland is becoming industrial. That’s something residents didn’t sign up for. We need some type of guardrails.”
Thomas’ district is slated to become home to the Prince William Digital Gateway, which, if completed as planned, would be the largest data center complex in the world. The Prince William County Board of Supervisors approved the project to build the campus of more than 30 data centers on 2,100 acres next to the Manassas National Battlefield in December 2023 following a contentious 27-hour public hearing. One of the selling points of the potentially $40 billion project was the anticipated $500 million in annual local taxes it could eventually generate for the county, which already has 8.3 million square feet of data centers.
Regionally, around 300 data centers are sprawled across Loudoun, Prince William and Fairfax counties, with the majority in Loudoun. The Ashburn area in Loudoun is home to the world’s largest concentration of data centers, a zone known as Data Center Alley.
Data centers have brought significant economic benefits to state and local coffers. According to the Data Center Coalition, the industry invested $37 billion in the commonwealth over just the past two years.
About 30% of Loudoun’s local budget comes from data centers, and officials estimate the industry will pay about $900 million in real estate and business personal property taxes for fiscal 2025, which begins July 1. “Our area is kind of used to [data centers] at this point and understands the benefits to schools and roads,” says Sen. Suhas Subramanyam, D-Loudoun.
And even more data centers are on the way.
Residents in the 291-home Great Oak subdivision in Prince William near Manassas began complaining in May 2022 about HVAC noise coming from the nearby Amazon data center complex. After about 18 months, Amazon took steps to cut the noise in half. Photo by Roger Snyder
Doubling down
“Virginia continues to distinguish itself as one of the most dynamic and important locations in the world for digital infrastructure that enables our innovation economy and meets the growing collective demands of individuals and organizations of all sizes,” says Data Center Coalition President Josh Levi.
Amazon Web Services, which invested $35 billion in Virginia data centers between 2011 and 2020, announced in 2023 that it plans to invest another $35 billion by 2040 to develop multiple data center campuses across Virginia.
The rampant growth of the data center industry has prompted a backlash from a range of environmental, conservation, historic preservation, climate advocacy and neighborhood groups up and down the Interstate 95 corridor.
This has resulted in some contentious local battles, often with political consequences. For example, in Prince William, Democrat Deshundra Jefferson, an opponent of unregulated data center growth, unseated the board’s incumbent at-large chair, Ann Wheeler, in a 2023 primary, largely over Wheeler’s support for the Digital Gateway project. County residents in January filed a lawsuit seeking to walk back the lame-duck board’s December 2023 approval of the Digital Gateway, just weeks before the new board took office on Jan. 1.
And in King George County, three outgoing supervisors voted in December 2023 to approve a $36 million tax rebate and tiered tax breaks for a $6 billion Amazon.com data center complex. But in January, a newly reconfigured five-member board — headed by a new chairman who had voted against the project — voted to renegotiate with Amazon, and also accepted the resignations of the county administrator and county attorney, although it was not clear that the resignations were connected to the Amazon deal.
Opponents argue data centers strain the state’s electric grid, consuming up to 50 times more power than typical commercial users, leading to increased costs for ratepayers. They also contend that data centers consume significant amounts of water, and negatively impact the character of nearby natural, historical and cultural resources and residential neighborhoods with noise pollution from massive HVAC units.
Advocates for data centers counter that the industry has endeavored to reduce centers’ environmental impacts and is willing to work with communities on the best placement for the facilities.
In response, Thomas and his General Assembly colleagues on both sides of the political aisle sponsored a multitude of bills in this year’s session seeking to place limits on data center development. Proposed legislation included requiring compliance with energy efficiency standards for tax credits, buffers between data centers and parks and residences, site assessment impacts on historical, agricultural and cultural resources, as well as water usage and carbon emissions and shifting the costs of additional electric demand to data centers.
None of the bills were approved, with most handed off to be included in a study of data centers’ impacts in Virginia by the Joint Legislative Audit and Review Commission, the state’s watchdog agency. JLARC plans to release that report late this year. Legislators welcome JLARC’s intensive look into data centers but are determined to keep up pressure on the industry and plan to submit more bills tackling data center development in the 2025 session.
Striking a balance
“People in Prince William have not been heard by the industry,” says Thomas, who sponsored three bills during the 2024 session dealing with the placement of data centers. “If we can get at least one reform-related bill out, the tide will start to turn.” One of his bills, HB338, encouraging localities to perform site assessments at their discretion before approving data centers, was the only data center-specific measure to make it through crossover when bills introduced in one chamber cross over to be voted on in the other. A Senate subcommittee continued the bill to the 2025 session.
“I knew it would be a tough fight, but I was surprised by the immense power that the data center industry wields in Richmond,” he says. “The industry has vehemently fought any data center-specific bill. Their tactic is the JLARC study — [to] wait and fold all the bills into that.”
Thomas believes HB338 made it as far as it did because it proposed a standard set of data points, including impacts on carbon emissions and water quality, for localities to consider when approving data centers. An amendment weakened the bill from mandating to encouraging site studies. Still, he is heartened by bipartisan support for increased statewide regulation of data centers. The issue impacts both Democrats and Republicans, he says. “Northern Virginia has grown and pushed out farther and farther, so there are Republican areas that could be next.”
A House subcommittee also tabled a data center reform bill from another Prince William delegate, Republican Ian Lovejoy, that would have prohibited data centers within one-quarter mile of schools, parks or residential areas. Lovejoy, who was elected last November to represent western Prince William County, says data centers are being built adjacent to residential neighborhoods in his district. “These areas have been rezoned from residential to light industrial to allow data centers to go there. It violates Urban Planning 101 in that you don’t put industrial uses adjacent to residential areas.”
Both Thomas and Lovejoy stress that they’re not opposed to data center development in Virginia but believe safeguards are essential.
“The goal is not to kill the data center industry,” Lovejoy says. “Data centers in appropriate locations get overwhelming support, but we need to have reasonable bumpers in place so a balance is struck between the industry’s needs and its neighbors’ needs.”
Levi says the industry supports the JLARC study: “We remain committed to continuing to work collaboratively with legislators and other stakeholders to ensure positive economic, environmental and social outcomes while building and supporting Virginia’s 21st century economy.”
The goal of regulation “is not to kill the data center industry,” but to ensure “a balance is struck between the industry’s needs and its neighbors’ needs,” says Del. Ian Lovejoy, R-Prince William. Photo by Matthew R.O. Brown
Demanding answers
Thomas, who plans to submit more data center bills in 2025, including revisiting those tabled this year, is especially concerned about the environmental impacts of data centers. “If you turn on 35 to 37 data centers over the next 10 years, each one uses an immense amount of power,” he says. “Dominion Energy cannot give us a straight answer on whether they can provide that power with clean or renewable energy.”
About 95% of all new power plants Dominion Energy is building over the next two decades will be carbon-free — including “offshore wind, solar, battery storage and advanced nuclear” — while about 5% will be natural gas, states Aaron Ruby, manager of media relations for the utility. (See related energy story.)
Dan Holmes, legislative director for Clean Virginia, a clean energy advocacy group, believes unchecked growth of data centers could impact the state’s mandate to attain 100% renewable energy generation by 2050. He points out that Dominion Energy anticipates energy demands
doubling over the next 20 years as more data centers are built.
“That will have severe consequences,” he says. “It impacts future retirements of power plants and interconnection problems with renewables. Those are huge challenges.”
Increasing numbers of residents are demanding answers as local governments rubber-stamp data centers, Holmes says. “It’s hard for local governments to say no to massive data centers because of the [tax] revenue they bring. They’re offered huge revenue opportunities but are not prepared to address the large questions and are not experts on energy or the infrastructure these centers require. Some localities are just now understanding the challenges after they’ve approved these things.”
Gregory A. Riegle, a partner with McGuireWoods law firm, has represented data center developers and operators for 25 years and says the industry has evolved to embrace green technology and aesthetically pleasing designs.
“Localities are increasingly identifying places where the industry would be a good fit and defining locations where it would be welcome and [could] balance the benefits of the industry with the impacts to the locality,” he says. “The industry is willing to have a dialogue with communities to get the right use in the right place.”
Riegle believes the JLARC study will bring stakeholders together to address concerns. “It’s good that they are taking time to look at [the issue] cohesively,” he says. “More time may lead to a more informed process.”
However, he warns against the General Assembly taking a one-size-fits-all approach by implementing a uniform set of regulations. “Ultimately, localities have to decide what’s best for their community. What makes sense for Loudoun County is different from what makes sense in Henrico County. You have to trust local governments to balance the issues because ultimately local elected officials are responsible to their own community.”
In Loudoun, state Sen. Subramanyam worries about long-term impacts from data centers, including the possibility that the infrastructure may one day become obsolete. And if that happened, he asks, “where does that leave our communities if they become so reliant on data centers for revenue? Right now, with the advent of AI and the need for data storage, data centers are needed more than ever, but we’ll see what happens in 10 to 20 years.”
Power struggles
Subramanyam believes JLARC’s findings will provide support for this session’s tabled bills proposing data center regulations, including bills he sponsored requiring data centers to commit to energy efficiency standards and to use renewable power sources to qualify for sales tax exemptions, as well as making the industry financially responsible for additional power lines needed for their facilities instead of putting the burden on all ratepayers.
“Data centers, while bringing a lot of revenue to the counties they are in, take up a lot of power,” he notes, adding that he’s concerned consumers could see their utility bills double in the next decade as more data centers come online. “We want to make sure data centers are offsetting the cost of building additional power infrastructures.”
However, Dominion forecasts that its residential customers’ monthly bills will increase by less than 3% annually over the next 15 years. “For a typical residential customer, that would mean an increase from about $133 a month to about $174 a month over a 15-year period,” says Ruby. “That’s lower than the normal rate of inflation.” He adds that Dominion’s residential rates are 18% below the national average and 34% below the mid-Atlantic average.
While there is often a partisan divide over renewable energy, Subramanyam contends that Democrats and Republicans want to retain green spaces and undeveloped areas. “That desire is on both sides when it comes to conservation and ensuring that in any sort of business development, the people who live in that community are getting a good deal.”
Meanwhile, grassroots groups say they’ll continue to sound alarms about data center developments. The Virginia Data Center Reform Coalition, composed of more than 40 environmental, conservation, historic preservation and climate advocacy groups and community and homeowner associations, has vigorously campaigned for statewide data center regulations. “This was a good start,” says Julie Bolthouse, director of land use for the Piedmont Environmental Council, a leader in the coalition. “Unfortunately, it’s going to take longer than we hoped, but many people are becoming aware of these impacts.”
Bolthouse was especially encouraged that legislators from both sides of the aisle came together to support data center reforms. “We’re seeing a lot more legislators that have heard about the issues and have a vague understanding that data centers use a lot of energy and water, but definitely a whole lot more education is needed.”
The JLARC study will provide concrete details about those usage rates, she adds. “There’s never been a hard look at impacts to the environmental and infrastructure grid. The impacts are already piling up, and changes are needed right now to address them. “We’re going to keep sharing what’s going on and keep raising awareness that costs are piling up if the state doesn’t take action.”
Action will come, adds Lovejoy. “The data center issue doesn’t know Republican from Democrat. It affects our constituents, so we have no choice but to find common ground.”
Editor’s note:This story has been corrected and updated from the April 2024 print issue version, which contained incorrect information related to the King George County supervisors’ election and a proposed Amazon.com data center complex.
Despite boasting a world-class port, a highly skilled workforce and easily accessible transportation infrastructures, Hampton Roads perennially comes away empty-handed in attracting large-scale industrial developments.
Chalk it up to the region’s lack of shovel-ready sites, a situation that state and local economic development and political leaders are fervently working to change. Last year, the Virginia Economic Development Partnership’s Virginia Business Ready Sites Program awarded $90 million in matching grants to 21 sites statewide with at least 100 contiguous, developable acres (or at least 50 acres in western Virginia). Three Hampton Roads sites made the list: Chesapeake’s Coastal Virginia Commerce Park, Fairwinds Landing in Norfolk and Hazelwood Farms in James City County.
VEDP President and CEO Jason El Koubi acknowledges that the state has only recently begun to significantly invest in site development, in contrast with other Southeastern states that have sunk billions into producing shovel-ready sites. In its 2022-24 budget, the state allocated $159 million to the Ready Sites Program, up from $5.5 million in 2021 — itself a bump up from about $1 million previously allocated annually by the state. In 2023, the General Assembly added an additional $200 million to the biennial state budget for the program, and in the 2024-26 budget, Gov. Glenn Youngkin has proposed $150 million in fiscal 2025 and $50 million in 2026.
With so little funding allocated for industrial site development in previous years, Virginia lost out on more than 55,000 direct jobs, 110,000-plus estimated indirect jobs and more than $124 billion in capital investment since 2016, El Koubi says. There are fewer than 10 sites larger than 250 acres ready for development across the state — and Virginia has won only one industrial megaproject in recent years: the $1 billion Lego Group toy factory, currently under construction in Chesterfield County.
Several Hampton Roads localities have teamed up to form the Eastern Virginia Regional Industrial Facility Authority, pooling resources into regional site development projects. It’s overseen by the Hampton Roads Alliance, led by President and CEO Doug Smith. Photo by Mark Rhodes
Despite more site preparation funding under Youngkin’s administration, Hampton Roads still has challenges, with fewer available land tracts for development compared with other regions. But, with some tweaks, El Koubi believes, the region can become a competitor in the industrial sweepstakes.
“There are multiple exciting site development opportunities in Hampton Roads. It’s a place where you find virtually every strength a location needs,” he says. “But because Hampton Roads has a very diverse economy with a long history and a lot of development already, most sites that are easy to be developed have already been developed, so we want to make sure we’ve very strategic about where we invest. It’s important that the region work together to invest and strategize to maximize opportunities in a way that everybody wins.”
Pooling resources
Building a successful industrial strategy is where the Eastern Virginia Regional Industrial Facility Authority (EVRIFA) comes into play. As the only entity of its type in the eastern part of the state and one of 11 in Virginia, the authority is a mechanism for multiple localities to pool regional resources into site development opportunities that benefit all of Hampton Roads.
Currently, the counties of Gloucester, James City, York and Isle of Wight and the cities of Hampton, Newport News, Poquoson, Williamsburg, Franklin and Chesapeake are members of EVRIFA, with Virginia Beach City Council voting in November 2023 to join the group in January.
Member localities invest in project sites, sharing costs and tax revenues. Municipalities with populations of less than 50,000 pay $2,000 per year for EVRIFA membership, while those with more than 50,000 residents join for $4,000 annually. Each locality has two primary and two alternate members represented on the authority’s board.
“Some communities are land-rich and cash-poor,” notes Doug Smith, president and CEO of the Hampton Roads Alliance. The region’s economic development arm, the alliance has managed EVRIFA since fall 2022. “Some have revenues but don’t have developable land. They can now team up.”
Localities are not obligated to fund site projects, with members deciding to join or pass on each proposed venture, Smith adds. “Each project is a distinct opportunity, and participation in revenues is based on the share of investment each community puts in.”
City and county officials on the Peninsula proposed establishing the authority back in 2018, with the idea that Southern Virginia localities could join later. “We’ve had conversations to get all of them in the authority,” Smith says. “We’re hopeful that all of them will by June 2024.”
Hampton, Newport News, Poquoson, Williamsburg and York and Isle of Wight counties are backing EVRIFA’s first project, Kings Creek Commerce Center in York County. The authority acquired the 432-acre parcel in 2022 from the state for $1.35 million, ultimately leasing it to Dominion Energy for a solar energy farm and is marketing the remaining 109 acres for light industrial development. “We’re showing the site to prospects and expect to see some results in the next year,” says Hampton Roads Alliance Chief Operating Officer Steve Harrison. “It’s been very well-received.”
Along with shovel-ready properties, developers want a skilled workforce, good transportation infrastructure, adequate energy supply and access to the port. “Ultimately, decisions are made on how quickly they can get a facility up and running,” Harrison adds. “That’s a driving factor. If they can’t get a site up and running quickly, they will go to a community where they can.”
Typically, sites in the region can become shovel-ready in six to 12 months. From there, the facility would open within 18 to 24 months of the contract being signed. Those time spans are significantly shorter than they were a decade ago, yet another consequence of the pandemic. “COVID impacted supply chains,” notes Smith. “You see a lot of reshoring, and folks need to move quickly to get businesses open and products moving.”
New and emerging industries such as battery storage, chip manufacturing and electric vehicle projects have bypassed Hampton Roads and Virginia for more competitive areas. “Without preparing sites and developing EVRIFA into a robust organization, we’re not going to be able to land those projects — period,” Smith says. “Everything is a cost of getting into the game.”
Hampton Roads leaders are eager for the region to become a player in the industrial site sweepstakes. Smith says whenever a large economic development project is announced in another state, he can expect a telephone call from a local political or business leader asking why Hampton Roads didn’t get the project. And “the answer,” he says, “is always that we didn’t have 1,500 or 500 acres prepared to meet their development criteria.”
Smith anticipates fewer of those calls in the future as the region and the state invest more funding into developing large sites. “Now, they’ll be calling wanting to come to the ribbon cutting.”
Moving forward
A ribbon cutting could soon take place at Hampton Roads’ lone industrial megasite, the Coastal Virginia Commerce Park in Chesapeake. Situated near the North Carolina border, the park has been touted as a good fit for computer and electrical products manufacturing, semiconductor microchip manufacturing or general advanced manufacturing. The City of Chesapeake and VEDP have received multiple applications, and Deputy City Manager Brian Solis anticipates a contract could be signed by mid-2024, although he declined to give further details. Industries interested in the park include companies involved in advanced manufacturing, sustainable energy and emerging sectors such as energy storage and battery manufacturing. Tracts will be a minimum of 250 acres.
“We’re preparing the site to get it to shovel-ready with all utilities in place,” Solis says. “It has substantial large tracts ready to be built on. The entire site was farmed with a sophisticated drainage infrastructure. It’s ready to go from a development standpoint.”
The city received a $750,000 grant in 2023 from the Virginia Business Ready Sites Program for surveying and environmental assessment work on the 1,420-acre site, which was rezoned from farmland to industrial in 2022. The Chesapeake Economic Development Authority entered a contract in 2022 to purchase the land for $37 million from Virginia Beach farmer Frank T. Williams and has an option to buy 2,600 adjacent acres for $54 million. The sale will be finalized once site studies are completed.
According to Solis, market analyses of comparable megasites along the East Coast give the Coastal Virginia Commerce Park high marks for its proximity to the Port of Virginia and the region’s skilled workforce, as well as the convergence of four interstates in Chesapeake, allowing for multiple shipping and transportation options. “Chesapeake is unique in Hampton Roads because it is in the central part of the region from a transportation standpoint and is a direct 15-minute drive to the port.”
Although Chesapeake has struggled with the tension between preserving rural, agricultural land and developing industrial centers, Solis says, the megasite has been relatively well-received as a future employment center. “We’re very conscious of industry’s proximity to residential areas and put it in the furthest proximity to our population as possible,” he says. “It’s a positive difference-maker in that you always look for opportunities to provide more employment opportunities to our Hampton Roads residents.”
Industrial tenants also alleviate the tax burden on residents, Solis adds. “We want to have a healthy balance of nonresidential and residential tax base. For every tax dollar the business pays, that helps contribute to the quality of life for our residents.”
Neighboring Suffolk, the state’s largest city in land area, is promoting 6 million square feet of industrial development on more than 500 acres at the Port 460 Logistics Center. Maryland developer Matan is working with Rockefeller Group to construct the 10-building warehouse project which is zoned for heavy industrial, logistics, advanced manufacturing, life sciences and warehouse uses. The initial phase encompassing five buildings with about 2.4 million square feet is expected to be under construction in the summer of 2024.
“Things are going full steam ahead,” says Suffolk Economic Development Director Nic Langford. “With any development, we’re open to all possibilities as long as it makes sense for our investments. This will be a very big addition and nice new industrial development for the city.”
Langford says Port 460 would be a good fit for a large manufacturer such as Mercedes-Benz or Volvo. “We would love to get big manufacturers here,” he adds. “We chase those projects all the time. It seems they don’t land in Hampton Roads.”
Along with available land, Langford believes a lack of housing curbs large manufacturers’ interest in the region. “To attract large manufacturers, you need all range of housing. Suffolk is one of the few municipalities that’s building new housing.”
The city is revisiting its 2045 comprehensive development plan as it determines how to meet demand for all types of growth. “Suffolk has quite a bit of land,” Langford notes. “We’re next on the agenda in Hampton Roads for development, but we have to strike a balance between the pressures of the private market and smart growth. We have an obligation to our taxpayers to ensure we don’t expand too rapidly.”
Suffolk has not joined EVRIFA, but Langford says city officials have been talking to authority leaders to determine future participation. “There’s some value in municipal and economic development authorities purchasing land. When they do that, the ultimate decision-maker is the city or the economic development authority, and they can be more picky about who comes in and what happens.”
Smith says the authority is “in conversations” with the cities of Norfolk and Portsmouth and other localities, and he is hopeful all Hampton Roads municipalities will become members in 2024.
Benefits of cooperation
Joining the regional authority positions Virginia Beach to be a leader in regionalism, long cited by Hampton Roads business leaders as a necessity for economic advancement, says Chuck Rigney, the city’s interim director of economic development. “EVRIFA allows the region to make a better case to land large, significant projects and moves the needle to position Hampton Roads as a leading metro area.”
Virginia Beach’s lack of large tracts suitable for industrial development strengthens its rationale for joining EVRIFA, Rigney adds. “Virginia Beach has matured to the point of looking at strategic redevelopment and realignment of existing assets to be sure they are for the highest and best use. By supporting this partnership, we hope to grow the wealth of Hampton Roads.”
However, lack of suitable acreage will continue to prevent the region from securing large-scale industrial investments, says commercial real estate broker Lang Williams, an executive vice president with Colliers International Virginia. “So much of our land has been developed for other uses or is wetlands and not suitable for development.”
However, Williams notes that companies are investing in Hampton Roads, just not on as grand a scale compared to areas like Savannah, Georgia. He points to logistics service provider Katoen Natie’s November 2023 announcement that it will invest $59.9 million to expand its Norfolk facility with a 450,000-square-foot warehouse and rail yard, adding an expected 76 jobs. “We have a diverse set of smaller projects in the tens of millions of dollars as opposed to billions of dollars, but they are a strong indication of companies tracking to the region.”
Hampton Roads also can expect to benefit from Lego’s impending Chesterfield County facility, which is expected to open for production in 2025, adding 1,760 jobs over a decade. “Suppliers will look down here for warehousing in other space,” Williams says. “Lego was a huge win for Virginia.”
It’s a win that VEDP’s El Koubi believes can be replicated. “Virginia is steadily closing the gap with other states in site development,” he says. “We’ll see the impact accelerate over the next couple of years and see Virginia have one of the top site development programs in the nation.”
Hampton Roads at a glance
Virginia’s second most populous region, Hampton Roads is comprised of 17 localities, including the cities of Virginia Beach, Norfolk, Chesapeake, Newport News, Hampton, Portsmouth, Suffolk, Williamsburg, Franklin and Poquoson, and the counties of Gloucester, James City, Isle of Wight, Mathews, Southampton and York.
Chrysler Museum of Art Photo courtesy Chrysler Museum of Art
Bordering the Atlantic Ocean and the Chesapeake Bay, Hampton Roads is home to the Port of Virginia and the largest naval complex in the world, Naval Station Norfolk, as well as Naval Air Station Oceana. Colleges and universities in the region include William &
Mary, Hampton University, Old Dominion University, Norfolk State University, Virginia Wesleyan University and Regent University.
Population
1.79 million (2020)
Top employers
Huntington Ingalls Industries (Newport News)
Smithfield Foods (Isle of Wight)
Bon Secours Maryview Medical Center (Portsmouth)
Science Applications International Corp. (Suffolk)
Children’s Hospital of The King’s Daughters (Norfolk)
Major attractions
Hampton Roads offers an abundance of natural, historic and cultural attractions, including the Virginia Beach Oceanfront, Colonial Williamsburg, Historic Jamestowne, the Virginia Aquarium & Marine Science Center, Chrysler Museum of Art, Busch Gardens, Ocean Breeze Waterpark, the Virginia Air & Space Center and Nauticus.
A sampling of hotels
The Cavalier Resort (including Embassy Suites by Hilton, The Historic Cavalier Hotel and Marriott Resort Virginia Beach Oceanfront)
547 guest rooms,
70,875 square feet
of event space
Hilton Norfolk The Main
300 guest rooms,
71,500 square feet
of event space
Embassy Suites by Hilton Hampton Convention Center
295 guest rooms,
161,974 square feet
of event space (including
connected convention center)
Already home to a nascent 176-turbine wind farm off the coast of Virginia Beach, Hampton Roads is expanding its foray into the clean energy industry with the creation of a green hydrogen production facility at Newport News’ Tech Center Research Park.
Last spring, the Blacksburg-based Virginia Tech Corporate Research Center, which operates the 40-acre park near Jefferson Lab, joined forces with the Hampton Roads Alliance and the cities of Newport News, Norfolk, Portsmouth and Virginia Beach to develop a $6.5 million green hydrogen fuel program aimed at sparking regional commercial development. The partnership received a $1.6 million grant from GO Virginia and $5 million from ITA International, Genplant, W.M. Jordan and the City of Newport News to develop the 5,000- to 10,000-square-foot demonstration lab, which is expected to be in operation in a year to 18 months.
Green hydrogen, produced from renewable energy sources such as Dominion Energy’s offshore wind farm, is created by separating hydrogen atoms from water molecules. It is expected to be a $410 billion global industry by 2030.
“Hydrogen is a clean fuel source that can burn 12 to 18 hours without stopping,” says Brett Malone, president and CEO of the Virginia Tech Corporate Research Center. “There are zero carbon emissions when burning hydrogen. It’s another tool to help the commonwealth reduce its carbon footprint and add energy capacity.”
Virginia’s 2022 Energy Plan includes directives to invest in hydrogen, which can be used to decarbonize large industrial, maritime and long-haul freight operations.
The center, which includes three to five hydrogen application projects to spur local industry investments and a workforce training program, is expected to lead to the creation of 230 jobs over the next five years. Malone says more than 30 applications have been identified, with initial efforts focusing on maritime and port operations, where vessels and trucks could be converted to run on hydrogen.
Officials with the Hampton Roads Alliance, a regional economic development organization, say energy transition will attract more industries and jobs to the area as businesses seek to incorporate clean energy in their operations.
“We saw the opportunity in Hampton Roads, starting with offshore wind, to be a leader in transitions and renewable energy sources,” says Matt Smith, the alliance’s director of energy and water technology. “This is part of a bigger picture of being an innovative region that’s attractive to businesses that want to use green energy.”
A 328-acre former James City County farm is set to become the largest speculative industrial project along the Interstate 64 corridor between the Port of Virginia and Richmond.
Hazelwood Farms was purchased for $12 million in April by Houston-based industrial real estate firm Lovett Industrial, which plans to develop a 2.2 million-square-foot business park on the site with Class A industrial facilities for manufacturers, importers, and warehousing and distribution companies. Multiple buildings will be constructed, ranging from 100,000 square feet to 1 million square feet. Twenty acres will be set aside for future commercial and retail development. Currently in the permitting process, the project is slated to begin construction on its first phase in early 2024. The project’s working name is Enterprise Logistics Park.
Rapid growth at the Port of Virginia, along with the Hampton Roads Bridge Tunnel expansion and the widening of Interstate 64 between Williamsburg and Richmond, attracted Lovett to the property, its first acquisition in Virginia.
“The Hampton Roads market has some of the best fundamentals in the country,” says Ben Swift, the company’s senior associate for the East Region. “That, combined with the billions of dollars being spent to upgrade the port and I-64, makes this property perfectly positioned to … draw upon the demand for industrial in Hampton Roads … [and] in Richmond.”
Ellis Colthorpe, an associate with Cushman & Wakefield | Thalhimer, which is handling marketing and leasing for the park, says tenants will include businesses already in the region, as well as newcomers. “Most tenants will use the Port of Virginia,” he adds. “The port has $1.4 billion in infrastructure projects, and that’s driving new tenants into the market.”
Additionally, Colthorpe notes, more than 500,000 potential workers live within a 45-minute drive from the park. “This will be a huge employment opportunity for James City County. Job creation and tax revenues are the two biggest hot-button items.”
Situated on Old State Road and a portion of Barnes Road south of I-64, the property had been in the Hazelwood family since 1886. The three Hazelwood siblings who sold the land to Lovett initially wanted the property rezoned to accommodate 75,000 square feet of commercial space, a truck terminal and up to 250 multifamily units. Community members had expressed concern about traffic and noise impacts, however.
Thousands of new jobs are flowing into Southern Virginia as Caesars Virginia prepares to open its permanent casino resort next year, and industries move into the region or expand.
Meanwhile, local economic developers have been pitching the vacant 3,500-acre Southern Virginia Megasite at Berry Hill for megaprojects like electric vehicle assembly and battery manufacturing plants that could employ as many as 8,500 people.
But how far will companies have to cast their nets to find workers to fill those positions?
Since 2015, companies have invested more than $1.55 billion in the Danville region, including Pittsylvania and Halifax counties, bringing more than 4,800 jobs to an area still regaining its economic footing following the shuttering of textile, apparel and furniture factories in recent decades.
When considering locations, companies look at the population and available labor force within a 45- to 60-mile radius. According to 2022 U.S. Census figures, just over 136,000 people live in the Danville region, including Pittsylvania and Halifax counties, including nearly 74,000 between ages 20 and 65, but about 1.2 million people reside within 45 to 65 miles. That includes Lynchburg and Roanoke, as well as the North Carolina metropolitan areas of Raleigh-Durham-Chapel Hill and Greensboro-Winston-Salem-High Point. Combined, those areas have a labor shed of more than 540,000 potential workers.
“Our population numbers are extremely impressive,” says Pittsylvania County Economic Development Director Matt Rowe. “That labor force is larger than the one within 60 miles of downtown Richmond.”
Higher-paying positions often attract employees from up to 60 miles away, while lower-skilled jobs can draw workers from within a 45-mile radius. “It comes down to getting as many qualified candidates as possible,” Rowe adds. “It’s in a company’s best interest to cast a wide net for workers – the bigger the funnel, the more fish they can catch, and from there, they can funnel it down to a specific skill set.”
About 30% of workers drive into the region, while approximately 13,000 Danville and Pittsylvania residents commute outside the area for job opportunities, says Corrie Bobe, Danville’s economic development director. “That’s a great market for new and existing industries to target. If people have the opportunity to remain here and not have to drive distances for quality jobs, they would prefer to do so.”
‘Building a pipeline’
The outflow includes residents who gained skills through local workforce training programs. Over the past decade, Danville and Pittsylvania County have allocated more than $70 million to ensure a pipeline of skilled workers, an investment Bobe touts to prospective industries. As part of site visits, business representatives tour local educational institutions, including Danville Community College, the Institute for Advanced Learning and Research (IALR) and middle and high schools where IALR’s GO TEC (Great Opportunities in Technology and Engineering Careers) program introduces students to the possibilities of careers in manufacturing. “Companies have been blown away by the large number of skilled [workers] that are training and have been trained here,” she says.
Established two decades ago to diversify Southern Virginia’s economy, IALR provides training in skills such as advanced manufacturing, information technology, automotive manufacturing and cybersecurity. “We’re building a pipeline of skilled workers,” says IALR President Telly Tucker. “Our strategy is to produce a well of talent because companies want to be close to … talent.”
Last fall, IALR opened its $28.8 million Center for Manufacturing Advancement, which provides new or expanding companies space to collaborate and integrate emerging and new technologies. The U.S. Navy also opened its Additive Manufacturing Center of Excellence at IALR to expand the military’s industrial base and provide defense contractors with workers trained in additive manufacturing. In addition, IALR hosts the Department of Defense’s Accelerated Training in Defense Manufacturing, a four-month program that trains workers from throughout the U.S. for jobs in the defense industry. About 800 to 1,000 workers are expected to complete the program by 2025.
IALR’s partnerships with businesses, high schools and community colleges show students the abundance of career options in their own backyard, adds Todd Yeatts, the institute’s executive vice president of manufacturing advancement. “Students with associate degrees or an adult with work experience can get industry credentials to allow them to step into leadership positions. It gives students an opportunity to pursue their dreams.”
Tucker believes that many students graduating from IALR programs will take advantage of increasing job prospects in Southern Virginia, reversing a population decline fueled by the exodus of textile and manufacturing jobs. “Many people will choose to stay in the region if jobs are available with good wages,” he says. “We’ll see a reverse of the population decline.”
Mark Funkey, who came to Danville Community College in January as vice president of workforce services, has been meeting with local businesses to determine their staffing needs. “There is a ton of need in the manufacturing industry for maintenance technicians, robotics and automation,” he says. “We’re working on developing customized training to focus on what individual companies need to fill their workforce or upscale the workforce they already have to take on higher level technical jobs.”
The challenge is getting the training programs up and running. “We have to have industry professionals to teach skills and the space and money to build or lease a building,” he adds. “These kinds of things are not inexpensive and don’t happen overnight.”
Funkey also has identified about 15,000 people in Danville and Pittsylvania and Halifax counties who have a GED or are eligible to obtain one. He wants to establish a program at the college to help residents earn their GED and move into workforce training. “Most jobs that need filling have skill components,” he notes. “We’re trying to get folks to attain the skills to be able to access those opportunities.”
He acknowledges there may not be enough locals to fill the influx of jobs. “We are limited in population. That’s a struggle, but we are working to the best of our ability to build the workforce. That’s why it’s important to upscale the local workforce.”
Trend reversal
U.S. Census figures show the region’s population declined by 9% between 2000 and 2021, with the prime working age group between 20 and 50 dropping by 27%. However, between 2020 and 2022, Danville saw a net gain of 509 more residents moving into the city than those leaving, though the overall population decreased slightly due to 751 deaths among the city’s aging populace during the same time period, according to a report from the Weldon Cooper Center for Public Service at the University of Virginia.
Linda Green, executive director of the Southern Virginia Regional Alliance, takes the increased migration to Danville as a good sign. “We’re seeing a new trend that reverses the population decline,” she says. “People are moving here for jobs with highly competitive wages.”
Green believes also that a cultural shift is occurring as middle and high school students are exposed to career paths in technology and consider staying in the area. “We’re used to seeing sports banners hanging in local high school gyms,” she says. “Now we’re seeing banners recognizing student accomplishments in technology competitions. It’s saying our programs are validated by some of the top companies in the nation. That impresses companies looking to move into the region.”
Danville and Pittsylvania County officials highlight the region’s skilled workforce when attempting to woo industries to the Southern Virginia Megasite at Berry Hill.
Earlier this year, Albemarle Corp. considered establishing a $1.3 billion lithium hydroxide processing facility at Berry Hill before choosing property in South Carolina, creating 300 jobs. The megasite also was in contention for Hyundai’s $5.5 billion electric vehicle assembly plant, which would have brought 8,500 jobs to the area, but the auto manufacturer selected a site near Savannah, Georgia. Additionally, in December 2022, Gov. Glenn Youngkin took the megasite out of the running for a $3.5 billion Ford Motor Co. electric vehicle battery factory over concerns that a Chinese company would be operating the facility; Ford instead chose a Michigan site for the plant, which is creating 2,500 manufacturing jobs.
Workforce issues did not factor into any of those rejections, says Bobe. “The access to talent has not been a component for the megasite being eliminated from projects. Usually, that’s our very strong point.”
In fact, the region’s labor pool played a large role in IperionX Ltd.’s decision last year to open its recycled titanium metal powder facility in South Boston. The Charlotte, North Carolina-based mineral company is investing $82.1 million and plans to hire more than 100 employees by 2025, with the potential for expansion, says IperionX founder and CEO Anastasios “Taso” Arima.
“Excellent community support, excellent infrastructure and political structure and a strong community workforce training program really made the choice straightforward to move to Southern Virginia,” Arima adds. “A lot of training programs are already in place to develop the labor we need, and we’re confident that we will be able to secure a labor force from a 45-minute to an hour’s drive away.”
Selling points
Caesars Virginia also expects to hire employees from within a 45-minute drive’s radius of Danville for its $650 million permanent resort hotel and casino, expected to open in late 2024. “That was the thinking that people would be willing to drive for a job,” says the casino’s general manager and senior vice president, Chris Albrecht, “but we’ve definitely gotten interest from areas beyond that.”
Economic development directors Matthew Rowe with Pittsylvania County and Corrie Bobe with Danville have been pitching the Southern Virginia Megasite at Berry Hill for megaprojects that could create thousands of jobs. Photo by Hannah King
The multimillion-dollar resort casino opened a temporary facility this spring with about 400 workers; casino management plans to have about 1,300 employees onboard when the permanent casino opens. Caesars has held hiring events, including one in Greensboro, and participated in career fairs at colleges and universities in Virginia and North Carolina.
Most of the casino’s employees so far live in the Danville area, Albrecht adds, with some transferring to the region from other Caesars facilities. “In the first wave of jobs, we were able to get employees from within 45 minutes. We’ll consider more options as the permanent facility gets built.”
Since arriving in Danville last year, Albrecht has been impressed with the area’s revitalization efforts. “The city has a lot of great economic development, and we’re looking forward to the casino helping bring further development to the area.”
About $50 million in public funds and $355 million in private monies have been invested in revitalizing Danville’s River District as a catalyst for attracting people back to the city. “Now it’s an attractive place for visitors and residents to enjoy,” says Bobe. “We look forward to substantial population growth in our community and are preparing for both the city and county to grow significantly.”
The projected growth is driving up demand for single and multifamily homes. An average of only 10 single-family dwellings have been built in Danville each year during the past decade, and officials say about 2,400 new units are needed for the influx of new workers. The city has identified several areas for construction or rehabilitation, including the struggling Danville Mall and the 60-acre Monument-Berryman Redevelopment Area. “We have a large pipeline for new housing options in development, whether in permitting or under construction, in both the city and the county,” notes Bobe.
Regional and national developers got a firsthand look at residential development opportunities during the Southern Virginia Regional Housing Summit last August. A second conference is scheduled for September. “National developers are already in the Raleigh-Durham and Greensboro areas,” says Pittsylvania’s Rowe. “It’s an easy process for them to come here, but our market has been neglected.”
Growing up in Pittsylvania, David Bennett was eager to leave the rural community as soon as he graduated from high school in 1980. “The minute I could go, I took off,” Bennett recalls. He returned seven years later after he accepted a job with Intertape Polymer Group Inc., a packaging products and systems company in Ringgold. In the interim, he’s come to appreciate Southern Virginia and its amenities.
“There have been a lot of improvements in schools, health care and housing,” Bennett says. He adds that many Intertape managers and technical staff have built homes in the area, a shift from just a few years ago when many salaried employees commuted from Greensboro. “The quality of life in this area is terrific. We’ve set up Danville to be successful.”
IALR’s Tucker says quality of life and cost of living are Southern Virginia’s main selling points. “There’s tremendous value in being a resident of this region. We have a lower cost of living, less traffic congestion and access to metro areas within an hour. Great things are happening in Southern Virginia.”
Southern Virginia at a glance
Running along a large stretch of the Virginia-North Carolina border, Southern Virginia includes Brunswick, Charlotte, Greensville, Halifax, Henry, Lunenburg, Mecklenburg, Patrick and Pittsylvania counties,plus the cities of Danville, Emporia and Martinsville. Once rooted in tobacco processing and textile manufacturing, the area has pivoted toward becoming an advanced manufacturing hub known for its innovative workforce training. Area higher education institutions include Averett University, Danville Community College, New College Institute, Patrick & Henry Community College and Southside Virginia Community College. The Institute for Advanced Learning and Research is a regional catalyst for workforce development, manufacturing advancement and economic development.
Danville Museum of Fine Arts & History Photo courtesy Virginia Tourism Corp.
Population
Danville: 42,348
Martinsville: 13,234
Pittsylvania County: 59,366
Halifax County: 33,257
Mecklenburg County: 30,179
Henry County: 48,835
Patrick County: 17,080
Brunswick County: 15,849
Lunenberg County: 11,936
Greensville County: 11,391
Charlotte County: 11,029
Emporia: 5,766
Top Employers
Goodyear Tire & Rubber Co.
Sovah Health
Hooker Furnishings Corp.
Eastman Performance Films LLC
Monogram Food Solutions LLC
Bassett Furniture Industries Inc.
Morgan Olson LLC
Tyson Foods
Nestlé Refrigerated Food Co.
Springs Global U.S. Inc.
Professional Sports
Martinsville Speedway is a short track — half a mile — and hosts multiple major NASCAR race weekends each year in the spring and the fall. With a 3.27-mile road course, Virginia International Raceway hosts multiple race weekends each year, including its biggest event, the International Motor Sport Association (IMSA) Weathertech Championship in late August.
Major Attractions
While auto racing is the region’s top draw, other attractions include the Virginia Museum of Natural History, with dinosaur and prehistoric whale fossils; the AAF Tank Museum, which has more than 120 armored tanks and artillery pieces on exhibit; Danville Science Center; and the Danville Museum of Fine Arts & History. Danville’s downtown River District features bars, restaurants, shopping and boutique hotel The Bee. For those who like to get outdoors, hike the scenic Riverwalk Trail or go kayaking, rafting and tubing on the Dan River.
Danville visitors could soon be setting up camp at the area’s first luxury RV park if City Council approves a special use permit for The Palace Resort, a project that could generate $1.3 million in annual city tax revenue.
The matter was set to go before Danville City Council on June 20, following the planning commission’s May 8 recommendation that Florida developer Joe Cubas be allowed to develop the 46-acre RV park near the North Carolina border. However, in response to neighboring residents’ concerns, City Council has tabled a decision on the RV park until a traffic impact study can be completed, which could take up to a year.
If approved, construction of the RV resort would take about six or seven months. Cubas, manager of J. Cubas Holdings LLC, had said in May that he had hoped to have the resort operating by late 2024, when the permanent Caesars Virginia resort casino in Danville is also expected to open.
The year-round RV park would have 333 RV sites, some with outdoor kitchens/gazebos, known as casitas. Other planned amenities include pools, spas, restaurants, a clubhouse, a gym, and tennis and pickle-ball courts. Shuttles would transport guests to the casino, as well as to downtown Danville, Martinsville Speedway, Virginia International Raceway and other destinations.
Cubas originally wanted to build The Palace Resort in Pittsylvania County, but its board of supervisors unanimously rejected the project last fall after residents voiced concerns about property values and the resort’s impact on nearby churches. Danville City Councilman Lee Vogler encouraged Cubas to seek a site in the city.
“I convinced him to give us a try,” Vogler says. “City Council is proactive in saying yes to things that bring in tourism and grow
our city.”
Danville’s location near the state line puts the region in good stead to tap into the booming RV industry, which has an annual economic impact of $2 billion in Virginia and $3 billion in North Carolina, according to the Herndon-based RV Industry Association.
“A number of our visitors travel by recreational vehicle,” Danville Economic Development Director Corrie Bobe says, noting that the planned RV park “will allow space for them to lodge and have quick access to tourism assets.”
The Palace Resort is another sign that Danville is successfully shedding its image as a fading textile town, Vogler says: “This is a big win for us and the region. It ties in with everything we’re doing to grow the economy.”
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